Investors shrug off Warren's pledge to break up tech giants

In brief: Senator Warren who is seeking a presidential candidacy for 2020 says tech giants have used proprietary marketplaces and leveraged mergers to limit competition.

In her pitch to rein in the influence of tech giants, the MA senator envisions legislation targeting companies with annual worldwide revenue of $25 billion or more, limiting their ability to expand and forcing parts of Google and Amazon's current business structure to operate as separate entities.

Warren claims that the trio has too much power over "economy, society and democracy" and continuously display anti-competitive behaviour. "They've bulldozed competition, used our private information for profit, and tilted the playing field against everyone else", Warren wrote in a post published on Medium.

Warren was set to speak about the policy to supporters Friday in Long Island City, which would've been home to one of Amazon's headquarters in NY but the tech-conglomerate pulled out of the deal after critics said the city gave them unfair government incentives.

Warren announced her candidacy for the 2020 United States presidential election on February 9.

I reached out to Amazon, Facebook, and Google for comment about Warren's proposal and will update this post if I hear back. "Google Search would have to be spun off as well". It would prohibit, for example, Amazon from selling its own line of "everyday items" called Amazon Basics - things like bath towels and HDMI cables - on Amazon's own marketplace.

Congress held a series of hearings past year looking at the dominance of major tech companies.

The proposal marks the most ambitious and aggressive effort targeting the tech industry offered by any Democratic contender for the White House, and it could put pressure on other presidential aspirants to offer similar plans for more aggressive tech oversight.

Consumer advocacy group Public Knowledge applauded Warren's plan, saying that large Internet platforms are able to "discriminate in favor of their own products and services, making it harder for small businesses to thrive, diminishing consumer choice, and potentially increasing prices".

"Sen. Warren is wrong in her assertion that tech markets lack competition".

Facebook has always been in the crosshairs of politicians, but Democrats have been frustrated by Republican-led hearings that they feel did not address the breadth of the company's power and whether it is using it responsibly. However small businesses would have more chance of gaining visibility, whether that be surfacing higher on search results or competing with Amazon.

Google spent $21 million to lobby in 2018 while Amazon spent $14.2 million and Facebook spent $12.6 million, their filings to Congress reveal. In the Senate, Warren continues to be an outspoken critic of Wall Street and is a leader of her party's progressive wing.

Matt Stoller, a fellow at the Open Markets Institute, which pushes for increased antitrust enforcement and stricter rules, tweeted that Warren's proposal is "smart and practical" and "a big deal".

Other Democratic candidates have also weighed in on the issue.

  • Eleanor Harrison